New Zealand’s Investment Savings and Insurance Association CEO Vance Arkinstall is among six directors of North South Finance charged with misleading investors over the financial state of the former Dominion Finance Group subsidiary.

The NZ Securities Commission has laid criminal and civil charges against the failed Dominion Finance Group and six directors of North South Finance, alleging investors were given misleading or incorrect information over party transactions, lending standards, loan qualities and liquidity.

Mr Arkinstall is facing up to five years’ jail or fines of $NZ300,000 ($242,000) under the criminal component of the commission’s case, and could also be fined up to $NZ500,000 ($403,000) under civil pecuniary provisions.

Dominion Finance Group, which purchased North South Finance in 2005 for $NZ40 million ($32 million) in cash and shares, went into receivership in September 2008 owing investors $NZ176.9 million ($142.9 million)

North South is able to keep operating under a moratorium, despite owing investors $NZ50 million ($40.4 million).